Cryptocurrency exchanges in India brace themselves for RBI ban

Cryptocurrency exchanges across India are preparing for the approaching RBI ban.  RBI on April 6 banned all banks and regulated authorities from having business relations with firms that deal with cryptocurrency.

They were directed to end all relations with the exchanges within the July 5. With the date of lapse soon approaching cryptocurrency exchanges are stopping fiat transactions and turning their focus solely to crypto-to- crypto trading.

Zebpay, an app enabled wallet provider, plans to continue cryptocurrency transactions even after the ban. Zebpay warned its customers this week that rupee withdrawals could stop . Zebpay wrote, "If Zebpay bank accounts are disrupted, rupee deposits and withdrawals will become impossible…[However] Crypto deposits and withdrawals are continuing as usual. The RBI circular only talks to banks, and other regulated entities about shutting accounts. This doesn’t affect BTC and other cryptos."

See also: Zebpay- largest Indian exchange, manipulating cryptocurrency market: For personal gains?

The exchange also said that, “Our present intention is to allow crypto-INR pairs to trade even after our bank accounts shut [down].” Nonetheless, it warned, “we are unable to fathom all the consequences of the bank account shutting [down] and hence cannot guarantee that we will continue the crypto-INR trade pairs forever.” This announcement led to a surge in their trading volumes while their prices dropped. Bitcoin prices fell sharply by 20%. Some media outlets claimed that Zebpay manipulated the crypto prices."

The RBI ban has caused many cryptocurrency exchanges to shift from India to foreign lands for survival. International digital asset Platform (IDAP) is a cryptocurrency exchange started by India- based founders but is set up in Estonia for running a legitimate business. "Businesses need their freedom to operate with efficiency, so shifting out is what exchanges will, sooner than later, do. Moreover, the people involved in cryptos have invested their time, effort and resources over many years to create their ventures or gain cryptocurrencies which they won't give up easily," said Awanish Rajan, CEO of IDAP, a cryptocurrency exchange.  IDAP is not the only one to shift its base. Cryptocurrency exchange, BuyuCoin, is shifting its base to Singapore and Binex.trade is moving to Estonia, The Hindu reported.

The ban termed as the 'end of virtual currencies' in India is causing a lot of commotion in the blockchain industry. Experts call this aftermath, of exchanges shifting abroad, quite natural in the wake of stringent regulations.

Image via shutterstock

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